The consumer optimum is the set of goods and services, subject to the limited income of the consumer, that
A. is characterized by zero marginal utility on each good and service.
B. maximizes the level of satisfaction for each consumer.
C. is characterized by increasing marginal utility.
D. the consumer can afford to buy.
Answer: B
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An increase in the price of the cheese used to produce pizza shifts the supply curve of pizza ________ and shifts the demand curve for pizza ________
A) rightward; leftward B) leftward; leftward C) leftward; not at all D) not at all; leftward
A technological improvement lowers the cost of producing corn. As a result, the price of a pound of corn ____ and the quantity of corn ____. Question 13 options:
A. falls; increases B. falls; does not change C. falls; decreases D. rises; decreases E. rises; increases
Figure 11.2Figure 11.2 shows demand and costs for a monopolistically competitive firm. At the profit maximizing output level:
A. the firm is earning a positive economic profit and more firms are expected to enter the market. B. the firm is earning a zero economic profit and no firms are expected to enter the market. C. the firm is earning a negative economic profit and more firms are expected to leave the market. D. There is not sufficient information.
When an economy is operating efficiently, which is TRUE?
A) All resources are fully employed. B) It would be possible to increase the output of 1 good without decreasing the output of the other. C) Resources are not fully employed or current technology is not being fully utilized. D) This economy is operating to the right of its production possibilities curve (PPC).